As a Chop5 Salad Kitchen franchisee, am I protected from competition from other franchisees, company-owned outlets, or other distribution channels controlled by the franchisor?
Chop5_Salad_Kitchen Franchise · 2024 FDDAnswer from 2024 FDD Document
You will not receive an exclusive territory or development territory. You may face competition from other franchisees, from outlets that we own, or from other channels of distribution or competitive brands that we control.
Your territory will consist of the geographic area within a ½-mile radius from your Restaurant. Upon renewal, we reserve the right to modify the boundaries of your territory in accordance with our then-current territory guidelines and criteria.
We reserve the right to develop and operate, and license third parties to develop and operate, Restaurants that
are located in Captive Venues, including Captive Venues located within your territory and development territory, if applicable. A "Captive Venue" means a non-traditional outlet for a Restaurant that is located within, or is a part of, another establishment or facility that consumers may visit for a purpose unrelated to the Restaurant. Examples of Captive Venues include Restaurants that are located within:
- hotels or casinos
- college campuses or universities
- airports, train stations, bus stations or cruise terminals
- stadiums or sporting arenas
- shopping malls
- military bases
- concert venues
- amusement parks
We also reserve the right to acquire, or be acquired by, another business or chain that may sell competitive or identical goods or services, and those businesses may be converted into Restaurants operating under the Marks regardless of their location (an "Acquisition"). Any such acquired or converted businesses may be located within your territory and development territory, if applicable.
We reserve the right to sell, and license others to sell, competitive or identical goods and services (either under the Marks or different trademarks) through Alternative Channels of Distribution, including within your territory and development territory, if applicable. An "Alternative Channel of Distribution" means any channel of distribution other than retail sales made to customers while present at a Restaurant. Examples of Alternative Channels of Distribution include:
- sales through direct marketing, such as over the Internet or through catalogs or telemarketing
- sales through retail stores that do not operate under the Marks, such as grocery stores or convenience stores
- sales made at wholesale
- sales through catering or delivery service
- sales through kiosks or mobile trailers
You are not entitled to any compensation for sales that take place through Alternative Channels of Distribution.
Source: Item 12 — TERRITORY (FDD pages 36–38)
What This Means (2024 FDD)
According to Chop5 Salad Kitchen's 2024 Franchise Disclosure Document, franchisees do not receive an exclusive territory. As such, a Chop5 Salad Kitchen franchisee may face competition from other franchisees, outlets that the franchisor owns, other distribution channels the franchisor controls, and competitive brands the franchisor controls. The franchisee's territory will consist of the geographic area within a ½-mile radius from their Restaurant. However, upon renewal, Chop5 Salad Kitchen reserves the right to modify the boundaries of the territory in accordance with their then-current territory guidelines and criteria.
Chop5 Salad Kitchen also reserves the right to develop and operate, and license third parties to develop and operate, Restaurants that are located in Captive Venues, including Captive Venues located within a franchisee's territory and development territory, if applicable. A "Captive Venue" means a non-traditional outlet for a Restaurant that is located within, or is a part of, another establishment or facility that consumers may visit for a purpose unrelated to the Restaurant. Examples of Captive Venues include Restaurants that are located within hotels or casinos, college campuses or universities, airports, train stations, bus stations or cruise terminals, stadiums or sporting arenas, shopping malls, military bases, concert venues, and amusement parks.
Furthermore, Chop5 Salad Kitchen reserves the right to sell, and license others to sell, competitive or identical goods and services (either under the Marks or different trademarks) through Alternative Channels of Distribution, including within a franchisee's territory and development territory, if applicable. An "Alternative Channel of Distribution" means any channel of distribution other than retail sales made to customers while present at a Restaurant. Examples of Alternative Channels of Distribution include sales through direct marketing, such as over the Internet or through catalogs or telemarketing, sales through retail stores that do not operate under the Marks, such as grocery stores or convenience stores, sales made at wholesale, sales through catering or delivery service, and sales through kiosks or mobile trailers. A franchisee is not entitled to any compensation for sales that take place through Alternative Channels of Distribution.